The World Bank halved Lebanon’s 2018 growth forecast to 1 percent, predicting its ratio of debt to gross domestic product would remain on an “unsustainable path,” Bloomberg News reported. The international lender cited a central bank decision to abruptly halt subsidized housing loans as a main factor behind the slowdown in economic activity this year. The real estate sector has provided “a rare source of growth impetus since 2012,” while production in most of the country’s other industries has fallen off, the World Bank said in its October report.

Lebanon’s finances have long resembled something out of Alice in Wonderland. Some investors are now wondering whether the house of cards is about to come crashing down in a messy sovereign default, the Financial Times reported. The backdrop is stark. The Mediterranean country’s government debt is equal to an eye-watering 153 per cent of its gross domestic product, the third-worst figure in the world after Japan and Greece.

Lebanon's worst bond market shock in a decade has raised doubts about whether the country's banks are willing and able to continue to bankroll the government, raising pressure on Beirut to step up reforms or risk a destabilising currency crisis, the International New York Times reported on a Reuters story. In September the cost of insuring Lebanese sovereign debt against default soared to its highest level since the global financial crisis of 2008, implying a more than 40 percent chance of default in the next five years.

The cost of insurance on Lebanese sovereign bonds has soared in recent weeks, reflecting concerns about the sustainability of the country’s debt burden as its economy slows and faces a potential cash crunch, the Financial Times reported. Like many emerging markets, rising global interest rates are swelling Lebanon’s external financing costs as the economy’s growth rate slows to 1.3 per cent this year. The country has the world’s third highest debt-to-GDP ratio at 150 per cent, a legacy of borrowing from public markets to rebuild after its devastating civil war.

Lebanon hopes to secure billions of dollars for infrastructure this week at an international donor conference in Paris, as it grapples with low growth and soaring debt, the International New York Times reported on an Associated Press story. Some 50 countries and international organizations are expected at the CEDRE (Cedar) conference that begins Friday, where Beirut will request up to $22 billion for an eight to 12 year investment program.

Germany's Blue Wings is looking for funds following a dispute with shareholder Alexander Lebedev, as financial problems led regulators to ban the Duesseldorf-based airline from flying, Reuters reported. The carrier halted flights earlier on Wednesday, mere hours before German aviation authorities revoked its operating license for the time being, according to a spokesman for the company. Blue Wings' financial woes, which have left its staff without pay since mid-November, stem from a lack of financing from shareholders, the spokesman said.

According to Lebanese media sources, Lebanese businessman and Hizbullah publishing executive Hajj Salah Ezzedine has declared bankruptcy, Al Bawaba reported. Ezzedine, from the town of Maaroub near the southern port city of Tyre, is the director of the Hizbullah-owned Dar Al-Hadi Publishing House, which has played a critical role in Hizbullah’s media campaign.